The goal is to understand how changes in the local chromosomal environment of particular genes influences their transcriptional activity. This phenomenon which has been called "position effect" is observed when the DNA sequence organization of particular genes is altered, either by insertion of foreign DNA sequences or by large scale chromosomal rearrangments. These changes in sequence organization can cause dramatic alterations in gene expression, and may either suppress or activate transcription. Moreover, position dependent alterations in gene activity have been directly implicated in oncogenesis. To study this phenomenon, we have chosen two different genes in the fruit fly Drosophila melanogaster, rudimentary and Bar, which exhibit position dependent changes in gene activity. Position effect mutations at both of these loci have been identified and these are associated either with the insertion of foreign DNA sequences or with chromosomal rearrangements. We will use a combination of genetic and molecular approaches to examine how specific changes in the DNA sequence environment of these genes alters their expression. These studies will include: (1) genetic experiments to generate new "position effect" mutations; (2) the analysis of the transcriptional activity of the wild type and mutant loci; (3) a detailed characterization of the DNA sequence organization of the wild type and mutant loci; and (4) an examination of how the chromatin structure of each locus is altered by the chromosomal rearrangements.